MANILA, Philippines — The Philippine property sector is seen topping its stellar performance last year to remain as a leading real estate market in the region this 2018.

Property consultancy firm Santos Knight Frank (SKF) said it expects even greater movement this year across key local real estate markets as investor confidence in the Philippines remains high and the government’s infrastructure expansion and fiscal reforms go into full swing.

“We thought we’ve seen the best of the real estate market, but it’s only about to get even better in 2018,” SKF chairman and CEO Rick Santos said in a recent press briefing.

“The Philippines remains as a leading real estate market in the region based on an impressive 2017 performance and with huge potential for growth in 2018. From an investment perspective, the country’s sound macroeconomic fundamentals, a talented labor pool, and the growing middle class are still the country’s main edge and will continue to set us apart from other Asian markets,” he added.

The property consultancy firm said the office sector, in particular, will continue to sustain its growth as increase in supply will be met by sustained demand, specifically by BPO companies.

It said more than 1.4 million square meters of leasable office space are expected to add to Metro Manila’s supply in 2018, with 40 percent coming to Bonifacio Global City.

“Demand for space in alternative office districts such as Alabang, Quezon City and the Bay Area is steadily increasing as rents in the key office districts such as Makati and BGC continue to go up,” SKF said.

For retail, the firm said shopping mall expansions and upgrading are widely being carried out in order to attract more customers, while the large volume of domestic consumption is pushing expansions of global brands and retail space in the country.

Meanwhile, SKF said the increasing requirements caused by considerable retail expansions are increasing demand for industrial spaces, which is expected to cause further tightening of industrial supply.

The company projects that approximately 560,000 square meters in gross leasable area of retail developments in Metro Manila will be put up until 2019.

“The huge appetite for consumption has been a stimulus for logistics property demand. With a booming traditional retail and e-commerce sector, there will be greater need for warehousing and distribution centers near urban areas,” said Calvin Javiniar, senior director of investment and capital markets at SKF.